Wills, Trusts & Estates Prof Blog

Editor: Gerry W. Beyer
Texas Tech Univ. School of Law

A Member of the Law Professor Blogs Network

Monday, June 29, 2015

6 Tips Family Trustees Should Follow

CalculationPeople should think twice before getting involved with serving as a trustee for friends or family.  The role of trustee can be a thankless position that carries with it many fiduciary responsibilities and risk of personal liability.  If a person is thinking about being a family trustee they should understand these six tips:

    1. Consider seeking professional help with trust management. If a trustee lacks the expertise needed to perform certain trust functions they may be able to use trust assets to pay for professional assistance.
    2. Impartiality is a must.  A trustee has a fiduciary responsibility to put the welfare of the beneficiaries first and to be impartial. 
    3. Be careful about investing. A trustee must be reasonably prudent when investing and has a legal obligation to invest in a diversified portfolio.  There may be an exception when family wealth is concentrated in a particular piece of property.
    4. Personal liability is a risk.  A trustee could be at risk of being sued, they should use caution and document all decisions.
    5. The experience will probably not be pleasant.  The role of trustee can be a stressful thankless responsibility that involves a lot of work. 
    6. Make sure there is a way out. If the pressures of being trustee become too much to bear there should be a mechanism in place for resigning. 

See Deborah L. Jacobs, 6 Tips for Family Trustees, Morningstar, June 28, 2015. 

June 29, 2015 in Estate Planning - Generally, Professional Responsibility, Trusts | Permalink | Comments (0)

Friday, June 26, 2015

How Financial Advisors Can Avoid Making Mistakes

Financial advisorFinancial advisors have an important task of advising clients on making smart investment decisions, sometimes though these financial advisers can make serious mistakes.  This column discusses some of the ways advisers can avoid or minimize some of the more common mistakes.  Firms should adopt a standardized and comprehensive process for reviewing a client’s information.  It is extremely important to keep up with the latest technology and to have a way to organize a client’s information in both a digital and paper format.  Financial advisors should also provide clients with a checklist to make sure all the necessary documents are in order. 

See Glenn G. Kautt, Advisors Mess Up Too: How To Prevent Planning Errors, Financial Planning, June 25, 2015.

Special thanks to Jim Hillhouse for bringing this article to my attention.

June 26, 2015 in Estate Administration, Professional Responsibility | Permalink | Comments (0)

Tuesday, June 16, 2015

Disbarred New York Attorney Charged With Grand Larceny And Practicing Law Without A License

JusticeA New York man who was disbarred about five years ago has been charged with stealing more than $34,000 from a client couple.  The State alleges that John Giordanella misrepresented himself to the couple by making them believe that he was still a practicing attorney.  The couple, believing that he was a licensed attorney, hired Mr. Girdanella to handle estate matters and gave him six checks totaling $34,247.  If convicted, Mr. Giordanella could face up to seven years in prison. 

See Disbarred attorney charged with stealing $34,000 in funds, Queens Chronicle, April 23, 2015.

Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.

June 16, 2015 in Current Affairs, Estate Planning - Generally, Malpractice, Professional Responsibility | Permalink | Comments (0)

Tuesday, June 2, 2015

Malpractice & Ethics Article Available on SSRN

MalpracticeI recently posted on SSRN my article entitled Avoid Being a Defendant: Estate Planning Malpractice and Ethical Concerns, 5 St. Mary's L.J. Mal. & Ethics 224 (2015).

Here is the abstract of the article:

An estate planner may become a defendant in a case involving an estate he or she planned in two main ways. First, the attorney may have performed his or her services in a negligent manner potentially creating exposure to malpractice liability. Second, the attorney’s conduct may have lapsed below ethically acceptable standards.

This Article reviews the exposure an estate planner may have to malpractice liability with emphasis on Texas law and then focuses the reader’s attention on ethical issues that may arise while preparing or executing the plan. The author hopes that by pointing out potentially troublesome areas, the reader will avoid the ramifications of drafting a flawed estate plan or having a lapse of ethical good judgment which may lead to the frustration of the client’s intent, financial loss to the client or the beneficiaries, personal embarrassment, and possible disciplinary action.

June 2, 2015 in Articles, Malpractice, Professional Responsibility | Permalink | Comments (0)

Thursday, May 21, 2015

Connecticut Attorney Arrested On Accusations Of Embezzling $1.8 Million

GavelA Connecticut attorney has recently been arrested on accusations that he embezzled $1.8 million from the estate of Miriam S. Strong.  Peter M. Clark was removed from his position as co-executor of Strong’s estate back in March when $1.8 million in money that was bequeathed to the town of Oxford went missing.  Clark is currently facing a Federal mail fraud charge over the incident.   

See Attorney Accused of Embezzling $1.8 Million From Woman’s Estate, NBC Connecticut, May 21, 2015.

Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.

May 21, 2015 in Current Affairs, Estate Planning - Generally, Malpractice, Professional Responsibility, Trusts, Wills | Permalink | Comments (0) | TrackBack (0)

Friday, May 8, 2015

Lawyer Charged With Stealing From Wards

Paul KormanikHaving served as a court appointed guardian, Columbus lawyer Paul Kormanik is now charged with stealing funds from his wards and is relinquishing his law license.  Kormanik has pleaded not guilty to 11 felony charges involving engaging in a pattern of corrupt activity, theft from an elderly person, and tampering with records for illegally controlling his wards’ bank accounts and stealing their funds.  In addition to these charges, the Columbus Bar Association brought 15 charges of professional misconduct against Kormanik.  His attorneys are requesting the probate judge to postpone his trial, which is scheduled to begin June 22.

See Randy Ludlow, Lawyer Accused of Stealing From Wards Gives Up Law License, The Columbus Dispatch, May 7, 2015.

May 8, 2015 in Elder Law, Estate Planning - Generally, Guardianship, Malpractice, Professional Responsibility | Permalink | Comments (0) | TrackBack (0)

Investment Firm Ordered to Pay $1.6 Million to Elderly Couple

Gavel2Signator Investors, a subsidiary of John Hancock Financial Network, has been ordered to pay an elderly couple and their mother's estate $1.6 million. The financial arbitration panel found that the broker in charge of their accounts breached his fiduciary duty and committed fraud by selling-away their investments. The broker invested in securities outside of the company that he had a management interest in.

See Wolters Kluwer Law & Business, Elderly Couple Awarded $1.2M Plus Attorneys Fees over Failed Investments, Resourcefullaw.com, 2015.

Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.

May 8, 2015 in Estate Planning - Generally, New Cases, Professional Responsibility | Permalink | Comments (0) | TrackBack (0)

Tuesday, April 28, 2015

Disbarred Estate Planning Attorney Charged With Grand Larceny

TheftA previously disbarred New York attorney is facing charges of third-degree grand larceny and a violation of the judiciary law that could result in up to seven years in prison. The former attorney was disbarred 2007. The charges are the result of allegedly representing himself as an attorney to a couple seeking help with a friend's estate in 2012. The couple allegedly paid $34,247 for various estate planning expenses, but only the deceased's will was filed, which did not accrue any fees.

See Disbarred Attorney Charged With Stealing $34,000 in Funds, Queens Chronicle, Apr. 23, 2015.

Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.

April 28, 2015 in Estate Administration, Estate Planning - Generally, Professional Responsibility | Permalink | Comments (0) | TrackBack (0)

Monday, April 27, 2015

State Bar Judge Rules To Disbar Lawyer for Misappropriation

Gavel 3When Michael Scott Keck removed $55,000 from the trust fund of a client who was in prison in order to repay a debt to another client, the bar suspended him from practice.  Now, a State Bar Court judge has recommended that a San Francisco attorney be disbarred.  Keck has practiced law since 1986 and had no prior record of misconduct. 

At the disciplinary trial, Keck testified that the fund’s previous financial advisor authorized him to borrow the money in the trust.  However, that testimony lacked credibility since an attorney should know that the adviser would not have the authority to allow a loan from trust assets.  Keck was “dishonest, concealed material facts from [his client] and others, and acted in bad faith,” the judge said in regards to Keck’s case.  Despite Keck’s good record in his practice of law, the judge said misappropriating a client’s funds is grounds four disbarment.

See Bob Egelko, State Bar Court Judge Rules to Disbar S.F. Lawyer for Taking Funds, SF Gate, Apr. 24, 2015.

Special thanks to Joel Dobris (Professor of Law, UC Davis School of Law) for bringing this article to my attention.

April 27, 2015 in Estate Planning - Generally, Malpractice, Professional Responsibility, Trusts | Permalink | Comments (0) | TrackBack (0)

Friday, April 24, 2015

Family Files Suit Against Attorney Reaping Millions From Will

Gavel2When Robert Mardigian wanted to put his financial affairs in order, he turned to his longtime friend and attorney, Mark Papazian.  Mr. Papazian subsequently drafted a will and trust that left the bulk of Mardigian’s fortune to Papazian and his two children. 

Yet, because Mardigian was unrelated to Papazian, the will was improper under the Michigan Rules of Professional Conduct, making clear that attorneys “shall not” prepare a will for a non-related client that includes a substantial gift for the attorney.

Now, Mardigian’s survivors are seeking that the gifts to Papazian and his children be disallowed.  A county judge ruled in their favor, and the case is now before the Michigan Court of Appeals.  “For over 100 years, the Supreme Court has ‘bluntly warned’ lawyers not to receive gifts from clients under wills they themselves have drafted.  Mark Papazian did it anyway . . . in flagrant disregard of his ethical duties as a member of the bar,” Gerald Gleeson, an attorney for Mardigian’s brother stated in a court filing. 

See Paul Egan, Family Fights Attorney Getting Millions From Client’s Will, Detroit Free Press, Apr. 11, 2015.

Special thanks to Jim Hartnett (Hartnett Law Firm) for bringing this article to my attention.

April 24, 2015 in Estate Administration, Estate Planning - Generally, Professional Responsibility, Wills | Permalink | Comments (1) | TrackBack (0)